Features

Taxes in the Philippines

March 15, 2018

Business Taxes in the Philippines

 

TAX When is it Paid?
a.)    Income Tax – This would depend in the set-up of the business

i. Sole Proprietorship – Graduated income tax from 20% to 35% depending on the net income

ii. Partnerships and Corporations – Corporate Income Tax of 30% of the Net Income or Minimum Corporate Income Tax of 2% of the Gross Revenue

Quarterly
b.)   Value-added Tax (VAT) – 12%

* Businesses with annual gross revenue not exceeding PhP 3,000,000.00 is not required to register as a VAT entity, however, they will be required to pay for Percentage Tax of 3% of the Gross Revenue.

Monthly
c.)    Local Government Business Taxes – This depends on the industry that the business is into. Usually it is 0.65% of the Annual Gross Revenue. January of every year
d.)   Real Property Taxes – This is paid for owning a real property in the Philippines, the usual rate is 2% of the assessed value of the property. January of every year

 

 

  • Businesses are also required to withhold taxes on its employees salaries, this shall be remitted to the BIR on a monthly basis.

 

 

Transfer Taxes in the Philippines

 

  • Capital Gains Tax – 6% of the Zonal Value or the Fair Market Value of the Property, whichever is higher.
  • Donor’s Tax – 6% of the amount of the donation
  • Estate Tax – 6% of the value of the estate